Wealth and small business ownership in Australian households : what rewards for business proprietors?

How much do we know about the personal financial returns derived from owning and operating a small-scale business venture? Business ownership, particularly relating to small business, is often portrayed as risky, and as being more uncertain and volatile than other career options, such as taking a job as a paid employee with the public service or with a business owned by others (eg. DeVaney et al., 1998; Holmes et al., 2003). Greater risk should produce greater returns; the personal investment of one’s time, energy and efforts in entrepreneurial activity should lead to a greater financial reward than that received by wage and salary earners in comparable positions. Is this actually the case? Do business owners generate and accumulate more financial benefits than employed persons? This paper examines data from large-scale Australian surveys on household income and wealth to investigate these questions and the ramifications of any differences for policy, professional advisory services and further research.